Pmi) Reports 2010 Second-Quarter Results

PRESS RELEASE

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PHILIP MORRIS INTERNATIONAL INC. (PMI) REPORTS 2010 SECOND-QUARTER RESULTS

• Reported net revenues, excluding excise taxes, up by 15.1% • Excluding currency, reported net revenues, excluding excise taxes, up by 8.3%

• Reported operating companies income up by 19.5% • Excluding currency, reported operating companies income up by 15.0% • Excluding currency, adjusted operating companies income up by 9.0%, including the items detailed in the attached Schedule 11

• Reported diluted earnings per share of $1.07, up by 35.4% versus $0.79 in 2009 • Excluding currency, reported diluted earnings per share up by 31.6%

• Adjusted diluted earnings per share of $1.00, up by 20.5% versus $0.83 in 2009 • Excluding currency, adjusted diluted earnings per share up by 16.9%

• Free cash flow up by 11.1% to $3.3 billion • Excluding currency, free cash flow up by 7.4%

• During the quarter, repurchased 21.7 million shares of its common stock for $1.0 billion

• Declared a regular quarterly dividend of $0.58 during the quarter

• PMI increases its forecast for 2010 full-year reported diluted earnings per share to a range of $3.75 to $3.85, up by approximately 16% to 19% compared to $3.24 in 2009, driven by favorable currency at prevailing rates; excluding currency, reported diluted earnings per share are projected to increase by approximately 14% to 17%

NEW YORK, July 22, 2010 – Philip Morris International Inc. (NYSE / Euronext Paris: PM) today announced reported diluted earnings per share of $1.07 in the second quarter of 2010, up by 35.4% from $0.79 in the second quarter of 2009. Excluding currency, reported diluted earnings per share were up by 31.6% as detailed on Schedule 13. Adjusted diluted earnings per share of $1.00 were up by 20.5% from 2009 adjusted diluted earnings per share of $0.83, including the items detailed on the attached Schedule 12. Excluding currency, adjusted diluted earnings per share were up 16.9% as detailed on Schedule 12. Free cash flow, defined as net cash provided by operating activities less capital expenditures, increased by 11.1% to $3.3 billion, as detailed on Schedule 19. “Though partially flattered by a timing favorability in Japan, we posted a strong quarter across all key metrics, confirming our sustained business momentum,” said Louis Camilleri, Chairman and Chief Executive Officer. “The widespread sequential improvement in Marlboro’s market share underscores our momentum and provides further evidence that our brand architecture initiatives are working.” “Our broad geographic footprint continues to serve us well, enabling us to deal with weakness arising in markets where economic recovery remains subdued.”

Conference Call A conference call, hosted by Hermann Waldemer, Chief Financial Officer, with members of the investment community and news media, will be webcast at 9:00 a.m., Eastern Time, on July 22, 2010. Access is available at www.pmi.com.

Dividends and Share Repurchase Program PMI declared a regular quarterly dividend of $0.58 during the second quarter of 2010, which represents an annualized rate of $2.32 per common share. In April 2010, PMI completed its 2008-2010 share repurchase program of $13 billion and, in May 2010, initiated a new, three-year share repurchase program of $12 billion. During the quarter, PMI spent $1.0 billion to repurchase 21.7 million shares of its common stock as shown in the table below.

2010 Second-Quarter PMI Share Repurchases

Shares Value (Mio.) ($ Mio.) $13 billion, two-year program, completed in April 2010 5.1 257.3 $12 billion, three-year program, commenced in May 2010 16.6 764.7 Total 21.7 1,022.0

Since May 2008, when PMI began its first share repurchase program, the company has spent an aggregate total of $13.8 billion to repurchase 294.2 million shares.

2010 Full-Year Forecast PMI increases its forecast for 2010 full-year reported diluted earnings per share to a range of $3.75 to $3.85, up by approximately 16% to 19% compared to $3.24 in 2009, driven by favorable currency at prevailing rates; excluding currency, reported diluted earnings per share are projected to increase by approximately 14% to 17%. This guidance includes $0.07 per share for the previously announced reversal of tax provisions, largely due to the completion of US tax audits, and excludes the impact of any potential future acquisitions, asset impairment and exit cost charges, and any unusual events. The factors described in the Forward-Looking and Cautionary Statements section of this release represent continuing risks to these projections.

SECOND-QUARTER CONSOLIDATED RESULTS

Management reviews operating companies income (OCI), which is defined as operating income before corporate expenses and amortization of intangibles, to evaluate segment performance and to allocate resources. In the following discussion, the term “net revenues” refers to net revenues, excluding excise taxes, unless otherwise stated. Management also reviews OCI, operating margins and EPS on an adjusted basis (which may exclude the impact of currency and other items such as acquisitions or asset impairment and exit charges), EBITDA, free cash flow and net debt. Management believes it is appropriate to disclose these measures to help investors analyze business performance and trends. For a reconciliation of operating companies income to operating income, see the Condensed Statements of Earnings provided with this release. Reconciliations of adjusted measures to corresponding GAAP measures are also provided with this release. References to total international cigarette market, total cigarette market, total market and market shares are PMI estimates based on latest available data from a number of sources. Comparisons are to the same prior-year period unless otherwise stated.

NET REVENUES PMI Net Revenues ($ Millions) Second-Quarter Excl. 2010 2009 Change Curr, European Union $2,295 $2,280 0.7% (1.2)% Eastern Europe, Middle East & Africa 1,889 1,640 15.2% 9.7% Asia 2,123 1,573 35.0% 21.4% Latin America & Canada 754 641 17.6% 6.1% Total PMI $7,061 $6,134 15.1% 8.3% Net revenues of $7.1 billion were up by 15.1%, including favorable currency of $419 million. Excluding currency, net revenues increased by 8.3%, primarily driven by favorable pricing of $341 million across all business segments that more than offset unfavorable volume/mix of $14 million, and acquisitions. The favorable pricing included the unfavorable impact of a partial tax absorption in Greece, primarily on Marlboro, to mitigate the compounded impact of an unfavorable structural excise tax change in April 2010, and three excise tax and two VAT-driven price increases during the first five months of 2010. Excluding currency and acquisitions, net revenues increased by 5.3%.

OPERATING COMPANIES INCOME PMI Operating Companies Income ($ Millions) Second-Quarter Excl. 2010 2009 Change Curr, European Union $1,105 $1,163 (5.0)% (0.3)% Eastern Europe, Middle East & Africa 786 635 23.8% 18.4% Asia 845 619 36.5% 19.9% Latin America & Canada 238 71 +100.0% +100.0% Total PMI $2,974 $2,488 19.5% 15.0%

3 Operating income increased by 19.6% to $2.9 billion as shown on Schedule 1. Reported operating companies income increased by 19.5% to $3.0 billion, including favorable currency of $113 million. Excluding currency, operating companies income was up by 15.0%, driven primarily by higher pricing, partly offset by higher costs, and acquisitions. Excluding currency, and the favorable impact of acquisitions which contributed 1.7 percentage points of growth, operating companies income was up by 13.3%. Adjusted operating companies income grew by 13.3% as shown in the table below and detailed on Schedule 11.

PMI Operating Companies Income ($ Millions) Second-Quarter 2010 2009 Change Reported OCI $2,974 $2,488 19.5% Asset impairment & exit costs 0 1 Colombian investment and cooperation agreement charge 0 135 Adjusted OCI $2,974 $2,624 13.3% Adjusted OCI Margin* 42.1% 42.8% (0.7) p.p. *Margins are calculated as adjusted OCI, divided by net revenues, excluding excise taxes.

Excluding the impact of currency, adjusted operating companies income margin was up by 0.3 percentage points to 43.1%, as detailed on Schedule 11. Excluding currency and acquisitions, adjusted operating companies income margin was up by 0.8 percentage points to 43.6%.

SHIPMENT VOLUME & MARKET SHARE

PMI Cigarette Shipment Volume by Segment (Million Units) Second-Quarter 2010 2009 Change European Union 59,024 62,900 (6.2)% Eastern Europe, Middle East & Africa 77,892 76,650 1.6% Asia 78,185 57,979 34.9% Latin America & Canada 25,858 25,636 0.9% Total PMI 240,959 223,165 8.0%

PMI’s cigarette shipment volume of 241.0 billion units was up by 8.0%. In EEMA, cigarette shipment volume growth of 1.6% was driven by Russia, Ukraine, the Middle East and double-digit growth in North Africa, partly offset by a decline in Turkey of 19.3% due to the impact of a significant excise increase in January 2010. In Asia, cigarette shipment volume increased by 34.9%, primarily reflecting a higher distributor inventory in Japan of approximately 3.4 billion units in anticipation of increased trade and consumer purchases ahead of an announced tax increase, effective October 1, 2010; double-digit growth in Korea; and the favorable impact of the PMFTC Inc. business combination in the Philippines of 17.2 billion units; partly offset by a decline in Pakistan, mainly due to a surge in the availability of illicit cigarettes. In Latin America & Canada, cigarette shipment volume increased by 0.9%, driven mainly by double-digit growth in Canada, which was fueled by an improvement in the tax-paid market as a result of continuing anti- contraband enforcement measures. These gains offset declines in the EU, primarily due to a lower total cigarette market and share in Germany; the impact of excise tax and VAT-driven price increases in the first

4 half of 2010 in Greece; and the economic downturn in Spain. On an organic basis, which excludes acquisitions, PMI’s cigarette shipment volume, flattered by the Japan inventory impact, was up by 0.3%. Total cigarette shipments of Marlboro of 77.9 billion units were down moderately by 0.5%, due primarily to decreases: in the EU, mainly reflecting a share decline in Germany, lower share in Greece, driven by the aforementioned excise tax and VAT-driven price increases, and the impact of the economic crisis in Spain; and, to a lesser degree, in Latin America & Canada. Cigarette shipments of Marlboro grew slightly in EEMA, primarily driven by Ukraine, the Middle East and North Africa, partly offset by Russia and Turkey; and grew strongly in Asia, primarily reflecting the aforementioned favorable distributor inventory impact in Japan, growth in the Philippines, and double-digit growth in Korea. Total cigarette shipments of L&M of 23.2 billion units were essentially flat, with shipment growth in all regions, except EEMA, primarily due to declines in Russia, Turkey and Ukraine, partially offset by double- digit growth in Algeria and Egypt. Driven by a double-digit increase in shipments in Russia and Ukraine, total cigarette shipments of Chesterfield of 10.3 billion units grew by 6.2%. Total cigarette shipments of Parliament of 9.9 billion units were up by 2.3%, led by growth in Japan, Korea and Russia, partly offset by Turkey. Total cigarette shipments of Lark of 9.2 billion units increased by 16.2%, driven by growth in Japan and Turkey. Total cigarette shipments of Bond Street of 12.3 billion units increased by 16.4%, driven by double-digit growth in Russia and Ukraine, partly offset by Turkey. Total shipment volume of other tobacco products (OTP), in cigarette equivalent units, grew by 55.0%, fueled by the acquisition of Swedish Match South Africa (Proprietary) Limited. Excluding acquisitions, shipment volume of OTP was down by 2.8%, primarily due to lower volume in Poland, reflecting the impact of the excise tax alignment of pipe tobacco to roll-your-own in the first quarter of 2009. Total shipment volume for cigarettes and OTP was up by 8.8%, or up by 0.2% excluding acquisitions. PMI’s market share performance registered a growing trend in a number of markets, including Argentina, Australia, Belgium, Egypt, Japan, Korea, Mexico, the Netherlands, the Philippines, Poland, Russia, Singapore and Switzerland.

EUROPEAN UNION REGION (EU)

In the EU, net revenues increased by 0.7% to $2.3 billion, including favorable currency of $42 million. Excluding the impact of currency, net revenues declined by 1.2%, primarily reflecting higher pricing of $119 million, which was more than offset by $146 million of unfavorable volume/mix. The higher pricing occurred across all main markets, with the exception of Greece, due to a partial tax absorption. The unfavorable volume/mix was primarily attributable to a lower total market and share in Germany, and lower total markets in Greece and Spain, reflecting the impact of adverse economic conditions and the impact of significant, largely tax driven price increases. Operating companies income decreased by 5.0% to $1.1 billion, due predominantly to unfavorable volume/mix of $110 million and unfavorable currency of $55 million, partially offset by favorable pricing. Excluding the impact of currency, operating companies income declined slightly by 0.3%, primarily reflecting favorable pricing offset by unfavorable volume/mix and the impact of a partial excise tax absorption in

5 Greece. Adjusted operating companies income declined by 5.1% as shown in the table below and detailed on Schedule 11.

EU Operating Companies Income ($ Millions) Second-Quarter 2010 2009 Change Reported OCI $1,105 $1,163 (5.0)% Asset impairment & exit costs 0 1 Adjusted OCI $1,105 $1,164 (5.1)% Adjusted OCI Margin* 48.1% 51.1% (3.0) p.p. *Margins are calculated as adjusted OCI, divided by net revenues, excluding excise taxes. Excluding the impact of currency, adjusted operating companies income margin was up by 0.4 percentage points to 51.5%, as detailed on Schedule 11.

The total cigarette market in the EU declined by 5.2%, mainly reflecting a lower total market in Greece and Spain, principally due to the unfavorable impact of a series of largely excise tax/VAT-driven price increases, and the impact of adverse economic conditions in those markets. PMI’s cigarette shipment volume in the EU declined by 6.2%, primarily reflecting the impact of the lower total market as described above and lower share. Shipment volume of Marlboro decreased by 8.7%, mainly due to the lower total market, unfavorable economic conditions, primarily in Greece and Spain, and lower share in Germany and Greece. Shipment volume of L&M increased by 4.5% compared to the second quarter of 2009, driven by share growth primarily in Germany and Greece. PMI’s market share in the EU was down by 0.4 share points to 38.9% as gains, primarily in Poland, were offset by share declines, mainly in the Czech Republic, Germany and Portugal. However, market share increased by 0.5 points compared to the fourth quarter of 2009 and grew by 0.5 points compared to the first quarter of 2010. Marlboro’s share in the EU was down by 0.6 share points to 18.1%, reflecting a lower share in France, Germany, Greece and Spain, partially offset by higher share in Italy, the Netherlands, Portugal and the Central European markets, in particular Poland. Marlboro share was up 0.2 points compared to the first quarter 2010. During the quarter, the continuing roll-out of Marlboro brand initiatives included the Marlboro Red pack upgrade in Finland, Greece, Norway and Sweden, the launch of Marlboro Core Flavor in Italy, the launch of Marlboro Gold Touch in Spain, and the launch of Marlboro Gold Advance in Switzerland. L&M’s market share in the EU grew by 0.6 points to a record 6.1%, its highest since the company’s spin-off in 2008, primarily driven by gains in Germany, Greece, Slovakia and Spain.

EU Key Market Commentaries In the Czech Republic, the total cigarette market was down by 5.8%, reflecting the impact of excise tax and VAT-driven price increases implemented in April 2010. PMI’s shipments were down by 11.5%. Although market share decreased by 3.1 points to 48.2%, mainly reflecting share declines for lower-margin local brands, shares for Marlboro and L&M were up by 0.1 point and 0.3 points, respectively. In France, the total cigarette market was down by 2.0%, reflecting the impact of the November 2009 retail price increase. PMI’s shipments were essentially flat. Although market share decreased moderately by 0.2 points to 40.8%, share was up by 0.4 points compared to the fourth quarter of 2009 and by 0.5 points

6 compared to the first quarter of 2010. Whilst Marlboro’s share declined in the second quarter of 2010 by 0.6 points to 26.3% compared to the second quarter of 2009, it was offset by a higher share for the premium Philip Morris brand, up by 0.8 points to 7.8%. Marlboro’s share increased by 0.2 and 0.4 points compared to the fourth quarter of 2009 and first quarter of 2010, respectively. In Germany, the total cigarette market was down by 2.1%, flattered by favorable trade inventory movements. PMI’s shipments were down by 9.5%, due primarily to the lower total market and a lower share of 35.9%, down by 2.9 share points. Although Marlboro’s share decreased by 3.2 share points to 21.6%, reflecting the impact of price sensitivity among adult consumers, share increased by 0.3 points versus the first quarter of 2010, indicating that the roll-out of the new architecture, most recently through the introduction of the new Marlboro Red pack upgrade in February 2010, is having a stabilizing effect. L&M, the fastest growing brand in Germany on a year-to-date basis, continued its strong performance during the quarter, gaining 0.9 share points to reach 9.4%. In Italy, the total cigarette market was down by 2.2%, primarily reflecting the impact of the December 2009 price increase. PMI’s shipments were down by 2.9%, largely due to the total market decline. Despite a slight market share decline of 0.2 points to 54.1%, share was stable compared to the full year 2009 and the first quarter of 2010. Fueled by the May 2009 and June 2010 launches of Marlboro Gold Touch and Marlboro Core Flavor, respectively, Marlboro’s share increased by 0.3% to 23.0%, and was up by 0.4 points compared to the first quarter of 2010. In Poland, the total cigarette market was down by 2.3%, reflecting the impact of the tax-driven price increases in the third quarter of 2009 and in January 2010, partially offset by in-switching from other tobacco products as a result of excise tax harmonization in 2009. PMI’s shipments were up by 2.1%. Market share was up by 1.6 points to 38.1%, primarily reflecting higher Marlboro share, up by 0.7 share points to 10.2%. In Spain, the total cigarette market was down by 10.1%, largely due to the adverse economic environment and the impact of the excise tax-driven price increase in June 2009, a further price increase in January 2010, and a June 2010 VAT-driven price increase of €0.25 per pack. PMI’s shipments were down by 15.4%, reflecting the lower total market and the impact of unfavorable distributor inventory movements. PMI’s market share was down by 0.5 points to 31.3%. Although Marlboro’s share decreased by 0.6 points to 14.8%, share was flat compared to the fourth quarter of 2009 and was up by 0.3 points versus the first quarter of 2010. Chesterfield’s share declined by 1.0 point to 9.0%, partially offset by the strong share gain of L&M of 0.9 share points to 6.1%.

EASTERN EUROPE, MIDDLE EAST & AFRICA REGION (EEMA)

In EEMA, net revenues increased by 15.2% to $1.9 billion, including favorable currency of $90 million. Excluding the impact of currency, net revenues increased by 9.7%, primarily driven by favorable pricing of $162 million which more than offset unfavorable volume/mix of $28 million. Excluding the impact of currency and acquisitions, net revenues grew by 8.2%. Operating companies income increased by 23.8% to $786 million, including favorable currency of $34 million. Excluding the impact of currency, operating companies income increased by 18.4%, primarily reflecting favorable pricing that more than offset unfavorable volume/mix. Excluding the impact of currency

7 and acquisitions, operating companies income was up by 16.9%. Adjusted operating companies income increased by 23.8% as shown in the table below and detailed on Schedule 11.

EEMA Operating Companies Income ($ Millions) Second-Quarter 2010 2009 Change Reported OCI $786 $635 23.8% Asset impairment & exit costs 0 0 Adjusted OCI $786 $635 23.8% Adjusted OCI Margin* 41.6% 38.7% 2.9 p.p. *Margins are calculated as adjusted OCI, divided by net revenues, excluding excise taxes. Excluding the impact of currency, adjusted operating companies income margin was up by 3.1 percentage points to 41.8%, as detailed on Schedule 11.

PMI’s cigarette shipment volume increased by 1.6%, principally due to Algeria, Egypt, the Middle East and Russia, mainly reflecting market share gains, partially offset by Turkey, driven by the significant tax-driven price increases of January, 2010, and the impact of unfavorable inventory movements. Shipment volume of Marlboro was up slightly by 0.2%, mainly reflecting strong growth in North Africa and Middle East, partially offset by declines in Russia and Turkey.

EEMA Key Market Commentaries In Russia, PMI’s shipment volume increased by 4.9%, the second consecutive quarter of growth since the first quarter of 2009. Whilst shipment volume of PMI’s premium portfolio was down by 4.9%, primarily due to a decline in Marlboro of 11.9%, this represented the lowest rate of segment decline since the fourth quarter of 2008. In the mid-price segment, shipment volume of Chesterfield was up by 13.3%. In the low price segment, shipment volume of Bond Street, Next and Optima was up by 31.3%, 10.4% and 4.4%, respectively. PMI’s market share of 25.5%, as measured by A.C. Nielsen, was up by 0.2 points. Market share for Parliament, in the above premium segment, was unchanged and up slightly on a year-to- date basis; Marlboro, in the premium segment, was down by 0.3 share points; Chesterfield in the mid-price segment was up by 0.3 share points; and Bond Street in the low price segment was up by 1.3 share points. In Turkey, the total cigarette market declined by an estimated 16.0%, primarily reflecting trade inventory movements in June 2009 ahead of the July 2009 price increase and the steep January 2010 excise tax increase which, combined, have contributed to a 40% retail price hike of premium-priced Marlboro. PMI’s shipment volume declined by 19.3%. PMI’s market share, as measured by A.C. Nielsen, declined by 2.0 points to 40.8%, due to Parliament, down by 1.5 share points, Marlboro, down by 1.9 share points, and L&M, down by 1.9 share points, partially offset by Lark Recess Blue, up by 4.0 share points. Compared to the first quarter 2010, PMI’s market share was essentially flat. In Ukraine, PMI’s shipment volume increased by 4.0%, reflecting the favorable impact of trade inventory movements in anticipation of an excise tax-driven price increase on July 1, 2010. PMI’s market share, as measured by A.C. Nielsen, was essentially flat at 35.7%, with share gains for both premium Parliament and mid-price Chesterfield offset by lower share for Marlboro and L&M. PMI’s year-to-date market share was up slightly by 0.1 point to 35.9% compared to the same period in 2009.

ASIA REGION

In Asia, net revenues increased by 35.0% to $2.1 billion, including favorable currency of $213 million. Excluding the impact of currency, net revenues increased by 21.4%, reflecting: favorable volume/mix of $143 million, mainly due to a higher distributor inventory in Japan of approximately 3.4 billion units in anticipation of increased trade and consumer purchases ahead of an announced tax increase, effective October 1, 2010; the favorable impact of the new business combination in the Philippines; and pricing of $38 million, primarily in Australia, Indonesia and Pakistan. Excluding the impact of currency and the favorable impact of the new business combination in the Philippines, net revenues grew by 11.5%. Operating companies income grew by 36.5% to reach $845 million. Excluding the impact of currency, operating companies income increased by 19.9%, mainly due to the additional distributor inventory in Japan, partly offset by higher manufacturing costs, primarily in Indonesia and Japan. Excluding the impact of currency and the favorable impact of the new business combination in the Philippines, operating companies income grew by 14.7%. Adjusted operating companies income increased by 36.5% as shown in the table below and detailed on Schedule 11.

Asia Operating Companies Income ($ Millions) Second-Quarter 2010 2009 Change Reported OCI $845 $619 36.5% Asset impairment & exit costs 0 0 Adjusted OCI $845 $619 36.5% Adjusted OCI Margin* 39.8% 39.4% 0.4 p.p. *Margins are calculated as adjusted OCI, divided by net revenues, excluding excise taxes. Excluding the impact of currency, adjusted operating companies income margin declined by 0.6 percentage points to 38.8%, as detailed on Schedule 11. Excluding currency and the impact of the new business combination in the Philippines, adjusted operating companies income margin was up by 1.1 percentage points to 40.5%, as detailed on Schedule 11.

PMI’s cigarette shipment volume increased by 20.2 billion units or 34.9%, mainly due to: gains in Japan, reflecting the distributor inventory build-up of approximately 3.4 billion units in anticipation of increased trade and consumer purchases ahead of an announced tax increase, effective October 1, 2010; 17.2 billion units from the new business combination in the Philippines; and double-digit growth in Korea, partially offset by a decline in Pakistan, reflecting the impact of multiple excise tax-driven price increases in June 2009, January and June 2010, and a surge in illicit trade. Shipment volume of Marlboro grew by 13.5%, reflecting the aforementioned inventory impact in Japan, growth in the Philippines, and higher share in Indonesia, Japan and Korea.

Asia Key Market Commentaries In Indonesia, PMI’s shipment volume decreased by 0.3%, and market share was down by 0.3 points to 28.5%, despite growth from Marlboro and the Sampoerna A franchise.

9 In Japan, the total cigarette market declined by 7.1%. PMI’s shipment volume was up by 20.8%, driven by the aforementioned favorable distributor inventory levels. PMI’s shipment volume is projected to decline in the second half of 2010 to adjust for these high distributor inventory levels, the continued underlying contraction of the total market and the expected unfavorable impact of tax-driven price increases in the fourth quarter of 2010. PMI’s market share of 24.3% was up by 0.3 points, representing the fifth consecutive year-on-year quarterly share gain. Marlboro’s share increased to 10.8%, up by 0.2 points, supported by the February 2010 national roll-out of Marlboro Black Gold, which recorded a 0.2% market share. Market share of Lark was up by 0.3 points to 6.7% and, for the first time since 2007, the Philip Morris brand recorded its first year-on-year share gain of 0.1 point to 2.4%. In Korea, the total cigarette market was down by 5.3%, partly reflecting competitors’ inventory adjustments from late 2009. PMI’s shipment volume surged 15.9%, driven by market share increases. PMI’s market share reached 16.6%, up by a strong 3.0 points, driven by Marlboro and Parliament, up by 1.2 and 1.5 share points, respectively, and Virginia Slims, up by 0.4 share points. On February 25, 2010, Philip Morris Philippines Manufacturing Inc. combined with Fortune Tobacco Corporation to form a new company called PMFTC Inc. As a result of this combination, PMI’s shipments were up by over 100% in the second quarter of 2010, and market share was an estimated 92.7%. Excluding the favorable impact of this new business combination of 17.2 billion units, cigarette shipments of PMI brands increased by 13.9%, fueled by double-digit growth of both Marlboro and the Philip Morris brand.

LATIN AMERICA & CANADA REGION

In Latin America & Canada, net revenues increased by 17.6% to $754 million, including favorable currency of $74 million. Excluding the impact of currency, net revenues increased by 6.1%, reflecting favorable pricing of $22 million, primarily in Argentina, Canada and Mexico and favorable volume/mix of $17 million. Operating companies income increased by over 100.0% to $238 million. Adjusted operating companies income grew by 15.5% as shown in the table below and detailed on Schedule 11.

Latin America & Canada Operating Companies Income ($ Millions) Second-Quarter 2010 2009 Change Reported OCI $238 $71 +100.0% Asset impairment & exit costs 0 0 Colombian investment and cooperation agreement charge 0 135 Adjusted OCI $238 $206 15.5% Adjusted OCI Margin* 31.6% 32.1% (0.5) p.p. *Margins are calculated as adjusted OCI, divided by net revenues, excluding excise taxes. Excluding the impact of currency, adjusted operating companies income margin was down by 1.7 percentage points to 30.4%, as detailed on Schedule 11, due primarily to higher manufacturing costs.

PMI’s cigarette shipment volume increased by 0.9%, driven mainly by growth in Canada. Shipment volume of Marlboro declined by 1.8%, mainly due to Argentina, Brazil and Mexico.

10 Latin America & Canada Key Market Commentaries In Argentina, whilst PMI’s cigarette shipment volume decreased by 2.0%, market share increased by 1.8 points to a record 74.8%, fueled by Marlboro, up by 0.3 share points to 23.4%, and the Philip Morris brand, up by a robust 1.9 share points to 38.3%. In Canada, the total tax-paid cigarette market was up by 20.0%, mainly reflecting stronger government enforcement measures to reduce contraband sales. Although PMI’s cigarette shipment volume increased by 18.7%, market share declined slightly by 0.4 points to 33.0%, with gains from premium price Belmont, up by 0.1 point, and low price brands Next and Quebec Classique, up by 3.9 and 1.3 share points, respectively. These were partially offset by mid-price Number 7 and Canadian Classics, and low-price Accord, down by 1.4, 2.0 and 1.2 share points, respectively. In Mexico, the total cigarette market was down by 1.5%. Although PMI’s cigarette shipment volume was essentially flat, market share increased by 0.9 points to 69.9%, fueled by Delicados, up by 1.0 point to 12.2%, partially offset by Benson & Hedges, down by 0.2 points to 5.6%.

Philip Morris International Inc. Profile Philip Morris International Inc. (PMI) is the leading international tobacco company, with seven of the world’s top 15 brands, including Marlboro, the number one cigarette brand worldwide. PMI’s products are sold in approximately 160 countries. In 2009, the company held an estimated 15.4% share of the total international cigarette market outside of the U.S., or 26.0% excluding the People’s Republic of China and the U.S. For more information, see www.pmi.com.

Forward-Looking and Cautionary Statements This press release contains projections of future results and other forward-looking statements that involve a number of risks and uncertainties and are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. The following important factors could cause actual results and outcomes to differ materially from those contained in such forward-looking statements. Philip Morris International Inc. and its tobacco subsidiaries (PMI) are subject to intense price competition; changes in consumer preferences and demand for their products; fluctuations in levels of customer inventories; increases in raw material costs; the effects of foreign economies and local economic and market conditions; unfavorable currency movements and changes to income tax laws. Their results are dependent upon their continued ability to promote brand equity successfully; to anticipate and respond to new consumer trends; to develop new products and markets and to broaden brand portfolios in order to compete effectively; and to improve productivity. PMI is also subject to legislation and governmental regulation, including actual and potential excise tax increases; discriminatory excise tax structures; increasing marketing and regulatory restrictions; the effects of price increases related to excise tax increases on consumption rates and consumer preferences within price segments; health concerns relating to the use of tobacco products and exposure to environmental tobacco smoke; privately imposed smoking restrictions; and governmental investigations. PMI is subject to litigation, including risks associated with adverse jury and judicial determinations, and courts reaching conclusions at variance with the company’s understanding of applicable law.

11 PMI is further subject to other risks detailed from time to time in its publicly filed documents, including the Form 10-Q for the quarter ended March 31, 2010. PMI cautions that the foregoing list of important factors is not complete and does not undertake to update any forward-looking statements that it may make, except in the normal course of its public disclosure obligations.

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12 Schedule 1 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Condensed Statements of Earnings For the Quarters Ended June 30, ($ in millions, except per share data) (Unaudited)

2010 2009 % Change Net revenues $ 17,383 $ 15,213 14.3 % Cost of sales 2,550 2,185 16.7 % Excise taxes on products (1) 10,322 9,079 13.7 % Gross profit 4,511 3,949 14.2 % Marketing, administration and research costs 1,537 1,460 Asset impairment and exit costs - 1 Operating companies income 2,974 2,488 19.5 % Amortization of intangibles 23 21 General corporate expenses 45 38 Operating income 2,906 2,429 19.6 % Interest expense, net 223 193 Earnings before income taxes 2,683 2,236 20.0 % Provision for income taxes 641 639 0.3 % Net earnings 2,042 1,597 27.9 % Net earnings attributable to noncontrolling interests 60 51 Net earnings attributable to PMI$ 1,982 $ 1,546 28.2 %

Per share data:(2) Basic earnings per share$ 1.07 $ 0.79 35.4 % Diluted earnings per share$ 1.07 $ 0.79 35.4 %

(1) The segment detail of excise taxes on products sold for the quarters ended June 30, 2010 and 2009 is shown on Schedule 2.

(2) Net earnings and weighted-average shares used in the basic and diluted earnings per share computations for the quarters ended June 30, 2010 and 2009 are shown on Schedule 4, Footnote 1. Schedule 2 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Selected Financial Data by Business Segment For the Quarters Ended June 30, ($ in millions) (Unaudited)

Net Revenues excluding Excise Taxes

Latin European America & Union EEMA Asia Canada Total

2010 Net Revenues (1) $ 7,260 $ 4,125 $ 3,903 $ 2,095 $ 17,383 Excise Taxes on Products (4,965) (2,236) (1,780) (1,341) (10,322) Net Revenues excluding Excise Taxes 2,295 1,889 2,123 754 7,061

2009 Net Revenues$ 7,155 $ 3,400 $ 2,947 $ 1,711 $ 15,213 Excise Taxes on Products (4,875) (1,760) (1,374) (1,070) (9,079) Net Revenues excluding Excise Taxes 2,280 1,640 1,573 641 6,134

Variance Currency 42 90 213 74 419 Acquisitions - 25 156 - 181 Operations (27) 134 181 39 327 Variance Total 15 249 550 113 927 Variance Total (%) 0.7% 15.2% 35.0% 17.6% 15.1%

Variance excluding Currency (27) 159 337 39 508 Variance excluding Currency (%) (1.2)% 9.7% 21.4% 6.1% 8.3%

Variance excluding Currency & Acquisitions (27) 134 181 39 327 Variance excluding Currency & Acquisitions (%) (1.2)% 8.2% 11.5% 6.1% 5.3%

(1) 2010 Currency increased net revenues as follows: European Union$ 187 EEMA 215 Asia 487 Latin America & Canada 188 $ 1,077 Schedule 3 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Selected Financial Data by Business Segment For the Quarters Ended June 30, ($ in millions) (Unaudited)

Operating Companies Income Latin European America & Union EEMA Asia Canada Total 2010 $ 1,105 $ 786 $ 845 $ 238 $ 2,974 2009 1,163 635 619 71 2,488 % Change (5.0)% 23.8% 36.5% 100+% 19.5%

Reconciliation: For the quarter ended June 30, 2009$ 1,163 $ 635 $ 619 $ 71 $ 2,488

Asset impairment and exit costs - 2009 1 - - - 1 Colombian investment and cooperation agreement charge - 2009 - - - 135 135

Acquired businesses - 10 32 - 42 Currency (55) 34 103 31 113 Operations (4) 107 91 1 195 For the quarter ended June 30, 2010$ 1,105 $ 786 $ 845 $ 238 $ 2,974 Schedule 4 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Net Earnings Attributable to PMI and Diluted Earnings Per Share For the Quarters Ended June 30, ($ in millions, except per share data) (Unaudited)

Net Earnings Attributable to Diluted PMI E.P.S.

2010 Net Earnings Attributable to PMI$ 1,982 $ 1.07 (1) 2009 Net Earnings Attributable to PMI$ 1,546 $ 0.79 (1) % Change 28.2 % 35.4 %

Reconciliation: 2009 Net Earnings Attributable to PMI$ 1,546 $ 0.79 (1)

Special Items: 2010 Tax items 121 0.07 2009 Colombian investment and cooperation agreement charge 93 0.04

Currency 61 0.03 Interest (20) (0.01) Change in tax rate 9 - Impact of lower shares outstanding and share-based payments 3 0.06 Operations 169 0.09 2010 Net Earnings Attributable to PMI$ 1,982 $ 1.07 (1)

(1) Basic and diluted EPS were calculated using the following (in millions):

Q2 2010 Q2 2009

Net earnings attributable to PMI$ 1,982 $ 1,546 Less distributed and undistributed earnings attributable to share-based payment awards 9 6 Net earnings for basic and diluted EPS$ 1,973 $ 1,540

Weighted-average shares for basic EPS 1,846 1,955 Plus incremental shares from assumed conversions: Stock Options 3 6 Weighted-average shares for diluted EPS 1,849 1,961 Schedule 5 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Condensed Statements of Earnings For the Six Months Ended June 30, ($ in millions, except per share data) (Unaudited)

2010 2009 % Change Net revenues $ 32,970 $ 28,499 15.7 % Cost of sales 4,922 4,156 18.4 % Excise taxes on products (1) 19,413 16,768 15.8 % Gross profit 8,635 7,575 14.0 % Marketing, administration and research costs 2,888 2,716 Asset impairment and exit costs - 2 Operating companies income 5,747 4,857 18.3 % Amortization of intangibles 43 36 General corporate expenses 83 72 Operating income 5,621 4,749 18.4 % Interest expense, net 446 351 Earnings before income taxes 5,175 4,398 17.7 % Provision for income taxes 1,379 1,284 7.4 % Net earnings 3,796 3,114 21.9 % Net earnings attributable to noncontrolling interests 111 92 Net earnings attributable to PMI$ 3,685 $ 3,022 21.9 %

Per share data:(2) Basic earnings per share$ 1.97 $ 1.53 28.8 % Diluted earnings per share$ 1.97 $ 1.52 29.6 %

(1) The segment detail of excise taxes on products sold for the six months ended June 30, 2010 and 2009 is shown on Schedule 6.

(2) Net earnings and weighted-average shares used in the basic and diluted earnings per share computations for the six months ended June 30, 2010 and 2009 are shown on Schedule 8, Footnote 1. Schedule 6 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Selected Financial Data by Business Segment For the Six Months Ended June 30, ($ in millions) (Unaudited)

Net Revenues excluding Excise Taxes

Latin European America & Union EEMA Asia Canada Total

2010 Net Revenues (1) $ 14,008 $ 7,481 $ 7,465 $ 4,016 $ 32,970 Excise Taxes on Products (9,529) (3,846) (3,469) (2,569) (19,413) Net Revenues excluding Excise Taxes 4,479 3,635 3,996 1,447 13,557

2009 Net Revenues$ 13,205 $ 6,231 $ 5,804 $ 3,259 $ 28,499 Excise Taxes on Products (8,938) (3,139) (2,641) (2,050) (16,768) Net Revenues excluding Excise Taxes 4,267 3,092 3,163 1,209 11,731

Variance Currency 220 142 385 125 872 Acquisitions 3 51 231 - 285 Operations (11) 350 217 113 669 Variance Total 212 543 833 238 1,826 Variance Total (%) 5.0% 17.6% 26.3% 19.7% 15.6%

Variance excluding Currency (8) 401 448 113 954 Variance excluding Currency (%) (0.2)% 13.0% 14.2% 9.3% 8.1%

Variance excluding Currency & Acquisitions (11) 350 217 113 669 Variance excluding Currency & Acquisitions (%) (0.3)% 11.3% 6.9% 9.3% 5.7%

(1) 2010 Currency increased net revenues as follows: European Union$ 756 EEMA 351 Asia 940 Latin America & Canada 311 $ 2,358 Schedule 7 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Selected Financial Data by Business Segment For the Six Months Ended June 30, ($ in millions) (Unaudited)

Operating Companies Income Latin European America & Union EEMA Asia Canada Total 2010 $ 2,167 $ 1,556 $ 1,569 $ 455 $ 5,747 2009 2,130 1,221 1,280 226 4,857 % Change 1.7% 27.4% 22.6% 100+% 18.3%

Reconciliation: For the six months ended June 30, 2009$ 2,130 $ 1,221 $ 1,280 $ 226 $ 4,857

Asset impairment and exit costs - 2009 2 - - - 2 Colombian investment and cooperation agreement charge - 2009 - - - 135 135

Acquired businesses 21927- 48 Currency 25 42 184 54 305 Operations 8 274 78 40 400 For the six months ended June 30, 2010$ 2,167 $ 1,556 $ 1,569 $ 455 $ 5,747 Schedule 8 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Net Earnings Attributable to PMI and Diluted Earnings Per Share For the Six Months Ended June 30, ($ in millions, except per share data) (Unaudited)

Net Earnings Attributable to Diluted PMI E.P.S.

2010 Net Earnings Attributable to PMI$ 3,685 $ 1.97 (1) 2009 Net Earnings Attributable to PMI$ 3,022 $ 1.52 (1) % Change 21.9 % 29.6 %

Reconciliation: 2009 Net Earnings Attributable to PMI$ 3,022 $ 1.52 (1)

Special Items: 2010 Tax items 121 0.07 2009 Asset impairment and exit costs 1 - 2009 Colombian investment and cooperation agreement charge 93 0.04

Currency 187 0.09 Interest (61) (0.03) Change in tax rate 13 0.01 Impact of lower shares outstanding and share-based payments 6 0.12 Operations 303 0.15 2010 Net Earnings Attributable to PMI$ 3,685 $ 1.97 (1)

(1) Basic and diluted EPS were calculated using the following (in millions):

YTD Jun 2010 YTD Jun 2009

Net earnings attributable to PMI$ 3,685 $ 3,022 Less distributed and undistributed earnings attributable to share-based payment awards 17 11 Net earnings for basic and diluted EPS$ 3,668 $ 3,011

Weighted-average shares for basic EPS 1,860 1,974 Plus incremental shares from assumed conversions: Stock Options 3 6 Weighted-average shares for diluted EPS 1,863 1,980 Schedule 9 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Condensed Balance Sheets ($ in millions, except ratios) (Unaudited)

June 30, December 31, 2010 2009 Assets Cash and cash equivalents$ 1,584 $ 1,540 All other current assets 11,340 13,142 Property, plant and equipment, net 6,162 6,390 Goodwill 9,790 9,112 Other intangible assets, net 3,779 3,546 Other assets 669 822 Total assets$ 33,324 $ 34,552

Liabilities and Stockholders' Equity Short-term borrowings$ 857 $ 1,662 Current portion of long-term debt 78 82 All other current liabilities 9,054 9,434 Long-term debt 14,296 13,672 Deferred income taxes 1,953 1,688 Other long-term liabilities 1,536 1,869 Total liabilities 27,774 28,407

Redeemable noncontrolling interests 1,173 -

Total PMI stockholders' equity 4,065 5,716 Noncontrolling interests 312 429 Total stockholders' equity 4,377 6,145 Total liabilities and stockholders' equity$ 33,324 $ 34,552

Total debt$ 15,231 $ 15,416 Total debt to EBITDA 1.29 (1) 1.42 (1) Net debt to EBITDA 1.15 (1) 1.27 (1)

(1) For the calculation of Total Debt to EBITDA and Net Debt to EBITDA ratios, refer to Schedule 18. Schedule 10 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Adjustments for the Impact of Currency and Acquisitions For the Quarters Ended June 30, ($ in millions) (Unaudited)

% Change in Reported Net Revenues 2010 2009 excluding Excise Taxes

$ 7,260 $ 4,965 $ 2,295 $ 42 $ 2,253 $ - $ 2,253 European Union$ 7,155 $ 4,875 $ 2,280 0.7% (1.2)% (1.2)% 4,125 2,236 1,889 90 1,799 25 1,774 EEMA 3,400 1,760 1,640 15.2% 9.7% 8.2% 3,903 1,780 2,123 213 1,910 156 1,754 Asia 2,947 1,374 1,573 35.0% 21.4% 11.5% 2,095 1,341 754 74 680 - 680 Latin America & Canada 1,711 1,070 641 17.6% 6.1% 6.1%

$ 17,383 $ 10,322 $ 7,061 $ 419 $ 6,642 $ 181 $ 6,461 PMI Total$ 15,213 $ 9,079 $ 6,134 15.1% 8.3% 5.3%

% Change in Reported Operating 2010 2009 Companies Income

Reported Reported Operating Operating Companies Reported Companies Income Reported Reported Operating Income Less excluding Operating Reported excluding Companies Less excluding Acquisi- Currency & Companies excluding Currency & Income Currency Currency tions Acquisitions Income Reported Currency Acquisitions

$ 1,105 $ (55) $ 1,160 $ - $ 1,160 European Union$ 1,163 (5.0)% (0.3)% (0.3)% 786 34 752 10 742 EEMA 635 23.8% 18.4% 16.9% 845 103 742 32 710 Asia 619 36.5% 19.9% 14.7% 238 31 207 - 207 Latin America & Canada 71 100+% 100+% 100+% $ 2,974 $ 113 $ 2,861 $ 42 $ 2,819 PMI Total$ 2,488 19.5% 15.0% 13.3% Schedule 11 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Operating Companies Income to Adjusted Operating Companies Income & Reconciliation of Adjusted Operating Companies Income Margin, excluding Currency and Acquisitions For the Quarters Ended June 30, ($ in millions) (Unaudited)

% Change in Adjusted Operating 2010 2009 Companies Income

Adjusted Adjusted Operating Less Operating Companies Less Reported Asset Adjusted Companies Income Reported Asset Adjusted Adjusted Operating Impairment / Operating Income Less excluding Operating Impairment / Operating Adjusted excluding Companies Exit Costs & Companies Less excluding Acquisi- Currency & Companies Exit Costs & Companies excluding Currency & Income Other Income Currency Currency tions Acquisitions Income Other Income Adjusted Currency Acquisitions $ 1,105 $ - $ 1,105 $ (55) $ 1,160 $ - $ 1,160 European Union$ 1,163 $ (1) $ 1,164 (5.1)% (0.3)% (0.3)% 786 - 786 34 752 10 742 EEMA 635 - 635 23.8% 18.4% 16.9% 845 - 845 103 742 32 (1) 710 Asia 619 - 619 36.5% 19.9% 14.7% 238 - 238 31 207 - 207 Latin America & Canada 71 (135) (2) 206 15.5% 0.5% 0.5% $ 2,974 $ - $ 2,974 $ 113 $ 2,861 $ 42 $ 2,819 PMI Total$ 2,488 $ (136) $ 2,624 13.3% 9.0% 7.4%

2010 2009 % Points Change Adjusted Adjusted Adjusted Adjusted Operating Adjusted Operating Adjusted Operating Operating Companies Operating Companies Operating Companies Companies Net Revenues Income Adjusted Companies Income Companies Net Revenues Income Income excluding Margin Adjusted Net Revenues Operating Income Margin Income excluding Margin excluding Excise Taxes, excluding Operating excluding Companies Margin excluding excluding Excise Taxes excluding Currency & Currency & Currency & Companies Excise Income excluding Currency & Currency & Currency(3) Currency Acquisitions Acquisitions(3) Acquisitions Income Taxes(3) Margin Currency Acquisitions

$ 1,160 $ 2,253 51.5%$ 1,160 $ 2,253 51.5% European Union$ 1,164 $ 2,280 51.1% 0.4 0.4 752 1,799 41.8% 742 1,774 41.8% EEMA 635 1,640 38.7% 3.1 3.1 742 1,910 38.8% 710 1,754 40.5% Asia 619 1,573 39.4% (0.6) 1.1 207 680 30.4% 207 680 30.4% Latin America & Canada 206 641 32.1% (1.7) (1.7)

$ 2,861 $ 6,642 43.1%$ 2,819 $ 6,461 43.6% PMI Total$ 2,624 $ 6,134 42.8% 0.3 0.8

(1) Represents the business combination in the Philippines. (2) Represents 2009 Colombian investment and cooperation agreement charge. (3) For the calculation of net revenues excluding excise taxes, currency and acquisitions, refer to Schedule 10. Schedule 12 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS and Adjusted Diluted EPS, excluding Currency For the Quarters Ended June 30, (Unaudited)

2010 2009 % Change

Reported Diluted EPS$ 1.07 $ 0.79 35.4%

Adjustments: Colombian investment and cooperation agreement charge - 0.04 Tax items (0.07) -

Adjusted Diluted EPS$ 1.00 $ 0.83 20.5%

Less: Currency Impact 0.03

Adjusted Diluted EPS, excluding Currency$ 0.97 $ 0.83 16.9% Schedule 13 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Reported Diluted EPS, excluding Currency For the Quarters Ended June 30, (Unaudited)

2010 2009 % Change

Reported Diluted EPS$ 1.07 $ 0.79 35.4%

Less: Currency Impact 0.03

Reported Diluted EPS, excluding Currency$ 1.04 $ 0.79 31.6% Schedule 14 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Adjustments for the Impact of Currency and Acquisitions For the Six Months Ended June 30, ($ in millions) (Unaudited)

% Change in Reported Net Revenues 2010 2009 excluding Excise Taxes

Reported Net Reported Net Revenues Reported Net Revenues excluding Reported Net Reported Less Revenues excluding Less Excise Taxes, Reported Less Revenues Reported excluding Reported Net Excise excluding Less Excise Taxes Acquisi- Currency & Net Excise excluding excluding Currency & Revenues Taxes Excise Taxes Currency & Currency tions Acquisitions Revenues Taxes Excise Taxes Reported Currency Acquisitions $ 14,008 $ 9,529 $ 4,479 $ 220 $ 4,259 $ 3 $ 4,256 European Union$ 13,205 $ 8,938 $ 4,267 5.0% (0.2)% (0.3)% 7,481 3,846 3,635 142 3,493 51 3,442 EEMA 6,231 3,139 3,092 17.6% 13.0% 11.3% 7,465 3,469 3,996 385 3,611 231 3,380 Asia 5,804 2,641 3,163 26.3% 14.2% 6.9% 4,016 2,569 1,447 125 1,322 - 1,322 Latin America & Canada 3,259 2,050 1,209 19.7% 9.3% 9.3%

$ 32,970 $ 19,413 $ 13,557 $ 872 $ 12,685 $ 285 $ 12,400 PMI Total$ 28,499 $ 16,768 $ 11,731 15.6% 8.1% 5.7%

% Change in Reported Operating 2010 2009 Companies Income

$ 2,167 $ 25 $ 2,142 $ 2 $ 2,140 European Union$ 2,130 1.7% 0.6% 0.5% 1,556 42 1,514 19 1,495 EEMA 1,221 27.4% 24.0% 22.4% 1,569 184 1,385 27 1,358 Asia 1,280 22.6% 8.2% 6.1% 455 54 401 - 401 Latin America & Canada 226 100+% 77.4% 77.4% $ 5,747 $ 305 $ 5,442 $ 48 $ 5,394 PMI Total$ 4,857 18.3% 12.0% 11.1% Schedule 15 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Operating Companies Income to Adjusted Operating Companies Income & Reconciliation of Adjusted Operating Companies Income Margin, excluding Currency and Acquisitions For the Six Months Ended June 30, ($ in millions) (Unaudited)

% Change in Adjusted Operating 2010 2009 Companies Income

Adjusted Adjusted Operating Less Operating Companies Less Reported Asset Adjusted Companies Income Reported Asset Adjusted Adjusted Operating Impairment / Operating Income Less excluding Operating Impairment / Operating Adjusted excluding Companies Exit Costs & Companies Less excluding Acquisi- Currency & Companies Exit Costs & Companies excluding Currency & Income Other Income Currency Currency tions Acquisitions Income Other Income Adjusted Currency Acquisitions $ 2,167 $ - $ 2,167 $ 25 $ 2,142 $ 2 $ 2,140 European Union$ 2,130 $ (2) $ 2,132 1.6% 0.5% 0.4% 1,556 - 1,556 42 1,514 19 1,495 EEMA 1,221 - 1,221 27.4% 24.0% 22.4% 1,569 - 1,569 184 1,385 27 (1) 1,358 Asia 1,280 - 1,280 22.6% 8.2% 6.1% 455 - 455 54 401 - 401 Latin America & Canada 226 (135) (2) 361 26.0% 11.1% 11.1% $ 5,747 $ - $ 5,747 $ 305 $ 5,442 $ 48 $ 5,394 PMI Total$ 4,857 $ (137) $ 4,994 15.1% 9.0% 8.0%

$ 2,142 $ 4,259 50.3%$ 2,140 $ 4,256 50.3% European Union$ 2,132 $ 4,267 50.0% 0.3 0.3 1,514 3,493 43.3% 1,495 3,442 43.4% EEMA 1,221 3,092 39.5% 3.8 3.9 1,385 3,611 38.4% 1,358 3,380 40.2% Asia 1,280 3,163 40.5% (2.1) (0.3) 401 1,322 30.3% 401 1,322 30.3% Latin America & Canada 361 1,209 29.9% 0.4 0.4

$ 5,442 $ 12,685 42.9%$ 5,394 $ 12,400 43.5% PMI Total$ 4,994 $ 11,731 42.6% 0.3 0.9

(1) Represents the business combination in the Philippines. (2) Represents 2009 Colombian investment and cooperation agreement charge. (3) For the calculation of net revenues excluding excise taxes, currency and acquisitions, refer to Schedule 14. Schedule 16 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS and Adjusted Diluted EPS, excluding Currency For the Six Months Ended June 30, (Unaudited)

2010 2009 % Change

Reported Diluted EPS$ 1.97 $ 1.52 29.6%

Adjustments: Colombian investment and cooperation agreement charge - 0.04 Tax items (0.07) -

Adjusted Diluted EPS$ 1.90 $ 1.56 21.8%

Less: Currency Impact 0.09

Adjusted Diluted EPS, excluding Currency$ 1.81 $ 1.56 16.0% Schedule 17 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Reported Diluted EPS, excluding Currency For the Six Months Ended June 30, (Unaudited)

2010 2009 % Change

Reported Diluted EPS$ 1.97 $ 1.52 29.6%

Less: Currency Impact 0.09

Reported Diluted EPS, excluding Currency$ 1.88 $ 1.52 23.7% Schedule 18 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Calculation of Total Debt to EBITDA and Net Debt to EBITDA Ratios ($ in millions, except ratios) (Unaudited)

For the Year Ended June 30, December 31, 2010 2009 July ~ December January ~ June 12 months 2009 2010 rolling

Earnings before income taxes$ 4,845 $ 5,175 $ 10,020 $ 9,243 Interest expense, net 446 446 892 797 Depreciation and amortization 458 447 905 853 EBITDA$ 5,749 $ 6,068 $ 11,817 $ 10,893

June 30, December 31, 2010 2009

Short-term borrowings $ 857 $ 1,662 Current portion of long-term debt 78 82 Long-term debt 14,296 13,672 Total Debt $ 15,231 $ 15,416 Less: Cash and cash equivalents 1,584 1,540 Net Debt $ 13,647 $ 13,876

Ratios Total Debt to EBITDA 1.29 1.42 Net Debt to EBITDA 1.15 1.27 Schedule 19 PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Operating Cash Flow to Free Cash Flow and Free Cash Flow, excluding Currency Reconciliation of Operating Cash Flow to Operating Cash Flow, excluding Currency For the Quarters Ended June 30, ($ in millions) (Unaudited)

For the Quarters Ended June 30, 2010 2009 % Change

Net cash provided by operating activities(a) $ 3,465 $ 3,146 10.1%

Less: Capital expenditures 169 178

Free cash flow $ 3,296 $ 2,968 11.1%

Less: Currency impact 108

Free cash flow, excluding currency$ 3,188 $ 2,968 7.4%

For the Quarters Ended June 30, 2010 2009 % Change

Net cash provided by operating activities(a) $ 3,465 $ 3,146 10.1%

Less: Currency impact 122

Net cash provided by operating activities, excluding currency $ 3,343 $ 3,146 6.3%

(a) Operating cash flow.